What's wrong with me being a rich man?

Chapter 696 Sets the Tone (4k)

Liu Chiping's trip back to China was to alleviate pressure and seek greater support.

While his tenure as president of Tencent is an indelible part of his professional resume, with the development of MusVid, especially its frequent interactions with overseas platforms such as Facebook and Google, his past glory has gradually faded.

One cannot dwell on the past forever, but past experiences, even those of being beaten, can be used to reflect on the present.

Liu Chiping used a famous competition that laid the foundation for Lingang's current situation to draw a parallel between the competition between MusVid, Snapchat, and Facebook. This made the attending executives feel strange, but also gave them a strong sense of déjà vu.

Especially those who personally experienced it, such as Zhong Zhiling, Lü Haiying, and Ge Zhijie.

Overseas markets are complex and relatively lacking in resources, and the unfamiliar situation was brought into the familiar by changing perspectives.

Listening to her senior colleague and General Manager Liu's conversation, Lü Haiying gained a general understanding of their ideas. She had previously been in charge of the MUS business overseas for a period of time, and given Douyin's leading position in the domestic market, her words carried considerable weight.

A large part of the reason for this is that she is quite supportive of adding features to Snapchat. The disappearing message feature is not difficult to implement and can be considered as part of the richer gameplay of Mus.

However, in retrospect, learning from the other party's features is tactical, while continuing to push Snapchat to compete with Facebook can be considered strategic.

Lu Haiying voiced her change of mind: "My senior brother and President Liu's views are very novel, um, both familiar and novel."

Everyone in the meeting room laughed.

Liu Chiping smiled as well, though he was still worried that President Lü would stick to his opinion.

Since joining the silicon carbon ecosystem, he has thoroughly understood President Yu's attitude. Silicon carbon data is indeed part of the process of decentralization and free management, which is also related to the fact that silicon carbon group needs to invest a lot of energy in car manufacturing. As such, as the head of the company, he must remotely control the company through the understanding and actions of the senior management.

Clearly, Zhong Zhiling and Lü Haiying, the couple who were among the first to follow President Yu and achieve success, have a different level of trust than others.

Liu Chiping certainly has more seniority in the industry, but this was also taken into consideration, and he hoped to reach a consensus with General Manager Lü and others.

He took a sip of tea to moisten his throat and explained his views: "The reason I think this is an opportunity for us to invest heavily is because Facebook is actually very similar to a penguin. This time, it is very likely to go all out to block the development of Snapchat."

"Facebook's core is building a social chain. More than 9% of its revenue comes from advertising, and the continued growth and premium pricing power of advertising are all built on this social chain."

"Where the social network is, that's where users' time, attention, and advertising budgets will be. To understand this, take Tencent as an example; that's the importance of QQ."

"Tencent went all out to counter WeChat, even going so far as to imitate it one-to-one, because WeChat might shake the company's bottom line during the transition from PC to mobile internet."

“Snapchat is in a similar situation now. From its inception, it has been a social tool for private acquaintances, which overlaps a lot with the core of Facebook, which is a social network of acquaintances.”

"Moreover, for teenagers, the 'read-and-delete' feature does not carry heavy social pressure. Speaking of this, I am reminded of an interesting statistic from Tencent: some young users of QQ Space would delete content because their posts did not get many likes."

“The mindset of teenagers is different. When they post things on Facebook, they face scrutiny from their parents, relatives, teachers and classmates, but Snapchat brings ease.”

“When we were making products, the thing we were most worried about, as Pony has also said, was that we were afraid of not being liked by young people, because the life or death of a social platform actually depends on how young people use it.”

"Facebook itself grew by capturing young people and college students. Back then, it faced MySpace, and now it's absolutely impossible for it not to worry about Snapchat getting the same treatment."

MySpace was once the world's number one social networking site, but it was successfully overtaken by Facebook.

Today, Facebook is facing a social media platform in the same arena that rivals its former glory and is valued at over $200 billion. It's difficult for Facebook not to mobilize resources to eliminate this threat.

Yu Xing couldn't help but applaud Liu Chiping's eloquent speech, and said with a smile, "Mr. Liu's analysis is simply... it could be used as a keynote speech at this year's Internet Conference."

Lu Haiying also said, "I think Mr. Liu's grasp of Zuckerberg's mindset really hit the nail on the head. I was thinking about it just now, but now I'm really convinced."

Facebook is currently still internally testing features similar to Snapchat, and it's not necessarily true that the giant is about to launch a major offensive based on the current situation. After all, simple moves cannot reveal the final resource allocation.

However, Liu Chiping's mentality of wanting to destroy WeChat is now perfectly applicable to Facebook.

Who else could have such a precise and keen mindset?
Perhaps only by bringing in Pony can we gain a slight advantage.

Liu Chiping's thoughts were somewhat vague before, but after being stimulated by Mr. Yu today, his mind was completely clear. He smiled at everyone and added, "Snapchat itself is ambitious. It only had disappearing messages at first, but later it added the Stories feature, which allows users to post updates that automatically disappear after 24 hours. It also eliminates the need for one-to-one sending, allowing all friends to see them. This upgrades it from private social networking to complete social networking among acquaintances, which can completely replace the core functions of Facebook and Instagram, which is WeChat and Wechat's current Moments feature."

The Stories feature is a continuation and upgrade of the disappearing message feature, which greatly expands Snapchat's reach. It was launched in 2013, and by this year, daily active users and user time have both doubled, which can be described as explosive growth.

This is shaking the very foundation of Facebook.

Yu Xing nodded, believing that Liu Chiping's words were enough to make everyone understand the situation.

He also mentioned his observations from his own perspective: "When we were developing WeChat, we received an offer to acquire it from Tencent, but Facebook did a better job in this regard. WeChat was only recruited halfway through its development, while Facebook offered $10 billion to acquire Snapchat two years ago, and then raised the price to $30 billion by the end of that year."

"This is also a common strategy of Facebook. In 2012, it acquired Instagram, and in 2014, it acquired WhatsApp, both of which were social media competitors."

Zuckerberg launched two acquisitions of Snapchat in 2013, both of which failed. In less than three years, Snapchat's valuation has exceeded $20 billion, making it one of the most threatening competitors.

Zhong Zhiling said, "The situation is very clear now. Mr. Liu's consideration is correct. We need to increase our investment and shift the advertising share to Snapchat to arouse Facebook's attention. Musk can raise a new round of financing, which will increase the total investment and adjust the proportion of advertising. Musk's advertising is the best illustration of Snapchat's threat to Facebook."

After thinking for a while, Liu Chiping said, "Mus has already poached some people from Facebook to attract users. They need to do some tactical deception internally. In fact, Snapchat clearly has IPO plans. It's already in Series F, with a large valuation and funding. Perhaps it should start its IPO by the end of this year or next year."

He looked at his boss and smiled, "Mr. Yu, I heard about your hedge fund's reputation when I was in the United States. Some people even asked me about the fund. Over Peak Hedge Fund could try investing in Snapchat, or, when Snapchat goes public, we could buy some of its stock. That would add fuel to the fire in the media."

Because the mastermind behind the short sellers is Chinese, the "King of Short Sellers" has cooled down in the US financial discourse this year, but his judgment on Brexit has brought his name back into the spotlight.

Liu Chiping felt that no matter how much fire was burned, it wouldn't be too much; the reputation of Guoshanfeng could definitely be used. Yu Xing blinked; it seemed everyone thought Guoshanfeng was a pretty useful tool.

“Mus is an entertainment content platform, so its priorities are different.” Lu Haiying looked down at the relevant data and said, “Comscore data shows that Snapchat’s smartphone penetration rate among 18- to 24-year-olds in the United States has reached 69%, the penetration rate among high school students has exceeded 90%, and the penetration rate among college students has exceeded 75%. This is indeed a terrifying penetration rate.”

"Another survey of teenagers showed that Snapchat surpassed Instagram and was rated as the most important social media platform."

"From this perspective, Facebook's focus for the next year or two will be competing with Snapchat, which means..."

Yu Xing offered a concluding assessment: "Mus has reached a window of opportunity for development, and this window of opportunity can last for at least one or two years."

Liu Chiping nodded in agreement.

At this point, Ge Zhijie suddenly asked a question: "So, between Snapchat and Facebook, who will win?"

Yu Xing looked at Liu Chiping.

After a moment of contemplation, Liu Chiping gave his opinion: "I think Facebook will win. Facebook has more resources, and the increased attention it gives will bring a lot of pressure. Its internal testing of the benchmark function is obviously going to use the same approach as Murong Fu, so Musk will win."

Just like the 3Q War, the ultimate winner was WeChat.

Yu Xing smiled and said, "Very good. I think Mr. Liu's analysis is basically consistent with everyone else's. Carbon silicon data needs to provide priority resources for the vigorous development of MUS. We need to see what level of results MUS can achieve after this window of opportunity."

The meeting continued to discuss the details, but after the leader gave his conclusion, the future direction of Mus and silicon carbon was set.

As the meeting neared its end at noon, Liu Chiping privately approached General Manager Yu again.

"Mr. Yu, I think Snapchat is actually in a pretty dangerous situation. If Peak Capital really wants to buy it, it should definitely not buy too much."

Yu Xing chuckled, "President Liu, you're really... being very persuasive."

“Snapchat is currently working on AR, but I think it will take some time before the technology is fully mature and ready for widespread adoption,” Liu Chiping said earnestly. “Moreover, I think that if our Mus develops, it will actually put a lot of pressure on it. The pool of investment is only so big. The mobile internet is still growing, but it will eventually enter a period of stagnation. I have confidence in Mus, which is also a negative factor.”

He winked at President Yu with an air of seriousness.

Yu Xing laughed and said, "What? You want me to short Snapchat in the future?"

Liu Chiping said, "Just like selling WeChat to Alibaba would impact Tencent's stock price, regardless of whether you're shorting it or not, there are objectively negative factors."

Yu Xing laughed heartily: "Well, objectively speaking, it is indeed possible, but..."

He hesitated for a few seconds before continuing, "However, I think there is a hidden threat to software like Snapchat, including Facebook. Their advertising revenue models are similar, and mobile internet now emphasizes precision in traffic targeting."

Liu Chiping didn't understand: "President Yu, what do you mean?"

“You know that advertising spending has increased significantly from computers to mobile devices. In addition to the increase in users’ usage time, another factor is the tracking of their data,” Yu Xing explained. “This tracking can be done within the app or across apps.”

Liu Chiping still didn't understand.

“For example, I search for travel information on Ctrip, but I get pushed hotel recommendations for my destination on Taobao. This kind of more precise advertising requires cross-app and cross-platform integration,” Yu Xing gave a specific example, and then asked, “Do you think this kind of advertising tracking rooted in system permissions will change in the future?”

Liu Chiping finally understood.

The more ads meet user needs, the more accurate the conversion will be, and the higher the conversion rate, the more money you'll make.

If you can only get 10 customers by advertising with another company, but you can get 20 by advertising with this company, then you should naturally choose the latter, even if the latter has a higher unit price.

If you want to better meet user needs, you naturally need to collect more user information, not only their actions in your own app, but also their actions in other apps. This will allow you to more clearly define user profiles and needs.

This collection behavior is rooted in system permissions and is common on today's smartphones.

Liu Chiping understood, but then became bewildered: "President Yu, will this... will it change? What are the latest hot topics? What are Facebook and Snapchat like?"

"The latest trending topics, including Douyin and Mus, are mainly analyzed based on users' actions within their own apps. Cross-app information collection accounts for less than 2%, while Facebook and Snapchat collect a lot of information across platforms." Yu Xing paused here, "I don't know if this will change in the future, but I do know that if it does, it will have a huge impact."

Liu Chiping could imagine the impact, and then he thought about the political correctness of emphasizing privacy in the US and European markets. He originally did not think that this kind of collection was a problem, but now he vaguely felt that it was indeed a possible change.

His thoughts raced, and he suddenly realized that even if things remained unchanged, they might still be persuaded to change by those with ulterior motives.

This kind of change is a huge negative factor...

It's not just Snapchat; even giants like Facebook could be severely damaged!

Liu Chiping looked at President Yu in front of him. What does this big short seller usually study in his spare time?
Aside from major short sellers, who else can uncover and analyze existing or potential negative factors in this way?

No, it's not just about passing through peaks. Without observing and understanding the advertising on software like Today's Hot Topics, one might not even notice such details.

Liu Chiping breathed a sigh of relief. He built cars, he investigated the emissions fraud of his competitors, he developed software, he studied the changes in his competitors' advertising, he figured out the details, and then used those details to his advantage against the listed company.

This is not the transformation of one Qi into three Pure Ones, but the merging of the three Pure Ones into one Qi.

(End of this chapter)